Auckland economic quarterly May 2018

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To overcome Auckland’s housing shortage, we need to incentivise the most efficient use of land, and to accurately price the cost to developers of new infrastructure across different parts of the city.

This means it is important to remove distortions in the infrastructure costs are recouped and the way rates are levied on properties.

Auckland Council is currently reviewing Development Contributions (DCs), the money that developers contribute to infrastructure to serve newd evelopments.

There are several further steps to better incentivise efficient use of land with infrastructure in place.

These include greater use of targeted rates for infrastructure, a switch from rates based on capital value to land value and from land use to land zoning,and using a value-maximising approach to determining what and where infrastructure goes.